According to a 2014 survey published by the American Marketing Association and Duke University, companies with less than $25 million in revenue spent an average of 11% of revenue on marketing. Those with $25-$99 million in revenue spent an average of 9% on marketing. That’s a significant amount of money, but the real issue is what companies get from their marketing efforts (and spending).
Why does marketing even matter? And if your sales are doing OK at the moment, why would you even want to worry about it?
Too often, businesses and organizations equate marketing with sales. But marketing’s job is to generate leads. Ideally, those should be qualified leads that can be turned over to the sales team to generate sales. So if sales are good, why would you need to generate more leads? Because your business needs leads. If you turn off your marketing efforts, the flow of new leads is reduced to a trickle, then a few drops, and then can dry up entirely.
Many businesses are cyclical. Even if they hold onto customers for a long time, eventually those customers leave—and need to be replaced. Or if revenues aren’t what they should be, the business needs more leads that will turn into customers. Marketing matters because leads don’t just appear out of thin air. Here are some of the challenges your business faces in finding new leads.
It’s Not an Overnight Proposition
While it depends on the specific industry you’re in, it’s generally true that you can’t “turn on” leads like a faucet. In some industries, it takes weeks, months, or even years to move someone from an “inquirerer” to a qualified lead that eventually becomes a client. Potential prospects move through a process.
People Are In Different Places
Not all of your prospective clients are in the same place in the marketing/sales cycle. Some are gathering very basic information. They might not even be convinced of their need, yet. Others are comparing your offering with the offerings of your competition. Some have general questions and others have very specific questions. Good marketing recognizes that the information people need varies with where they are in the process. Good marketing also recognizes that you can’t move someone ahead in the process just because your sales numbers are down.
Marketing Means Feedback
Good marketing isn’t about sending out the same old message time and time again. It’s true that you need consistency in your marketing messages, but successful marketing is always looking at the feedback: what works and what doesn’t when it comes to getting your message out and generating leads. That means testing and tracking your results.Marketing isn’t just about telling your prospects why your goods or services are right for them. It’s also about listening to your clients so that you actually shape your products and services to better meet their needs. And guess what? The more what you have to offer meets needs the more of it you’ll sell.
Why does marketing matter? It keeps your message and your value proposition in front of potential clients. If done properly, it generates new leads for you business that drive sales. And finally, if you make sure it’s a two-way-street, it provides you with information about your customers that allows you to tailor your products, services, and offerings.